Towards the close of the century it became customary for canal companies applying to Parliament for powers, or extensions of existing powers, to seek for authority to make railways, waggon ways or stone roads in connection with their canals; and these they were generally authorised to lay down to any existing or future mines, quarries, furnaces, forges or other works within a distance of, at first four, subsequently eight, miles of such canal. They were, also, authorised to construct any bridges necessary for giving access to the canal. If, after being asked to make a railway, waggon road or bridge, under these conditions, the canal company refused so to do, the person or persons concerned could carry out the work at his or their own cost and charges, without the consent of the owner of the lands, rivers, brooks or water-courses it might be necessary to cross, though subject to the payment to them of compensation under conditions analogous to those in force in regard to the construction of canals. One Act of this type, the Aberdare Canal Act, 1793, goes on to say: "Every such rail way or waggon road and bridge ... shall ... be publick and open to all persons for the conveyance of any minerals, goods, wares, merchandizes and things, in waggons and other carriages," of a specified construction, "and for the passage of horses, cows and other meat cattle, on payment to the person or persons at whose charge and expense such rail way or waggon road shall have been made or erected" of the same rates as would be payable to the canal company under like conditions.

It was in South Wales, even more than on the Tyne, that the early railways eventually underwent their greatest development. In "Illustrations of the Origin and Progress of Rail and Tram Roads and Steam Carriages or Loco-motive Engines" (1824), by T. G. Cumming, Surveyor, Denbigh, we read:—

"As late as the year 1790 there was scarcely a single rail-way in all South Wales, whilst in the year 1812 the rail-ways, in a finished state, connected with canals, collieries, iron and copper works, &c., in the counties of Monmouth, Glamorgan and Carmarthen alone extended to upwards of one hundred and fifty miles in length, exclusive of a very considerable extent within the mines themselves, of which one company at Merthyr Tydvil possessed upwards of thirty miles underground connected with the stupendous iron works at that place; and so rapid has been the increase of rail-ways in South Wales of late years that at the present period they exceed four hundred miles, exclusive of about one hundred miles underground."

The whole of these lines were on the tram-plate, or flanged-rail, principle, while solid blocks of stone were, in Wales, generally substituted for wooden sleepers. Cumming further says:—

"In the extensive mining districts south of the Severn, including South Wales, the rail and tram roads are very numerous, and here, perhaps, more than in any part of the United Kingdom, owing to the steepness, great irregularity and impracticable nature of the ground, they have been of the most essential utility in supplying the place of canals....

"There are numerous tram roads connected with the canal between Cardiff and Merthyr Tydvil, in Glamorganshire. The extent of rail road about Merthyr Tydvil alone is very considerable; besides which, in the same neighbourhood are the Hirwaen, Aberdare, and Abernant tram roads, and a great variety of others communicating with the vast works on the hills in the vicinity."

One of the South Wales tramroad schemes—though not specifically mentioned by Cumming—is of exceptional interest inasmuch as it represented, probably, the first attempt ever made to introduce a railway as a direct rival of and competitor with a canal, instead of being simply a feeder thereof. The attempt was a failure, but it nevertheless constitutes a landmark in early railway history.

The story begins with the granting, in 1790, of an Act for the cutting of a canal between Merthyr and Cardiff by the Company of Proprietors of the Glamorganshire Canal Navigation, improved means of transport being then much needed in the interests of the iron-works and other industrial undertakings in the district. The Act of 1790 authorised the company to spend £90,000 on the canal; but this amount was found to be inadequate, and in 1796 a second Act sanctioned the raising of a further £10,000, and, also, the cutting of a short extension at the Cardiff end.

The opening of the canal for traffic is thus recorded by J. Phillips in the fourth edition (1803) of his "General History of Inland Navigation":—

"Feb. 1794. The canal from Cardiff to Merthir-Tidvil is completed, and a fleet of canal boats have arrived at Cardiff laden with the produce of the iron works there, to the great joy of the whole town. The rude tracks, through which the canal passes in some places are constantly improving, from the happy and healthful toil of the husbandman, and in a few years will be forgotten in a garden of verdure and fertility. This canal is 25 miles long; it passes along the sides of stupendous mountains. Nothing appears more extraordinary than, from a boat navigating this canal, to look down on the river Taaf, dashing among the rocks 100 yards below. The fall from Merthir-Tidvil to Cardiff is nearly 600 feet."